In the most straightforward words, Regulatory Compliance is a company’s adherence to laws and regulations made by the government or other authorized bodies. In a fast-evolving and progressive world, new laws are regularly instated by the government to keep up with technology. Each industry has its own set of rules and regulations. Not adhering to or complying to these regulations can prove drastic for a company in more ways than one. In addition to facing monetary penalties, it could also be imposed with functional sanctions and legal punishments. It will result in reduced profits and impart a bad brand image, and none of these is desirable.
Given the rise in automation and the dire need to be efficient, most reputed companies now use compliance software solutions to keep track of all the legalities in their industry. Regulatory compliance is different from internal audit compliance, and the two should not be confused with each other. External regulatory compliance is ensuring your organization adheres to all the rules and regulations set by governing bodies and strategizing procedures to follow them.
Some industries have more regulations, and so the costs incurred by different companies are bound to vary. For instance, a financial services company is regulated in the interests to protect the public and investors from unethical business practices. In contrast, a chemical factory would have strong regulations to protect the environment and ensure sustainability. Data Protection in today’s economy has become very crucial, and hence digital companies will have to comply with regulations regarding keeping the data secure.
Why is it important?
Compliance software solutions help in maintaining a track of regulatory compliance. It is imperative to safeguard consumers and society from malicious practices. It also helps the organization to function ethically and keep up with all the industry standards. It is thus building a sharp brand image for itself.
Data Protection laws are now coming into place for most industries and given the growing trend of automation everywhere; it is far more critical than ever to protect the data in an organization. If you are not compliant, your company is always exposed to risks, and the possibility of incurring damages and losses become multifold. You can find a perfect contract management software in India that fits your budget and requirements.
Challenges with Regulatory Compliance
Most companies run on a very tight budget and implementing regulatory compliance can get relatively expensive. The first question that needs to be answered here is whether regulatory compliance management should be an in-house affair or outsourced. If your company is large enough and you can afford to have an internal team, it is good to take this path. If you cannot afford a team of your own, outsourcing is the best way to go about it.
The complexity involved in the procedure makes the task tedious. However, compliance management solutions have become very user-friendly and allow the users to not only stay updated with industry standards but also let you take care of everything with just a few easy clicks.